California Gov. Gavin Newsom has tapped $20 million in taxpayer funds to hire a major public relations firm to combat what his administration calls “negative narratives” about the state, triggering pushback from lawmakers during a budget hearing Thursday.
The Governor’s Office of Business and Economic Development, known as GO-Biz, awarded the contract to Edelman, a global PR firm whose client list includes Starbucks, Dove, eBay and Heineken. Edelman’s task: fight “negative narratives amplified online and in partisan media” and promote California’s economy and tourism.
The money was originally budgeted for a more straightforward tourism promotion initiative. It was later redirected when the Newsom administration decided a narrower travel-and-tourism pitch didn’t capture the “broader scope of promotional activity” they had in mind, according to state budget analysts.
GO-Biz Director Dee Dee Myers told the budget committee Thursday the campaign is still being developed and will be “nationally focused.” She did not rule out running ads in other states encouraging people to move to California.
Myers pushed back on criticism that people and businesses are actually leaving the state in significant numbers, calling those claims exaggerated. “There’s been a little misinformation out there, in our view, and this is a chance to tell the real California story,” she said.
Republican state Sen. Roger Niello wasn’t buying it. He accused the campaign of trying to shut down legitimate debate about the state’s regulatory environment and business climate rather than address the underlying problems.
“To attempt through a PR campaign to cut off any debate, and therefore ignore the possibility that we have regulatory burdens here that make it difficult sometimes to do business, this PR campaign is going to cut off any debate of that sort,” Niello said. “If you don’t recognize the things that might hamper businesses being successful here, you’ll never be able to cure that problem.”
Niello added that regardless of exaggerated claims, “California around the country is not rated as exactly the best place to do business.”
Even Democratic budget committee chair Sen. Melissa Hurtado acknowledged the tension. “I also don’t disagree with my colleague in terms of what else we need to do to improve the business environment for businesses to stay.”
The Newsom administration has also been at pains to insist the campaign isn’t a stepping stone to a 2028 presidential run. “The campaign will tell the California story, not the Gavin Newsom story,” GO-Biz said in a statement. A Newsom spokesperson previously told the Los Angeles Times that California’s business climate has been “falsely and maliciously maligned for years.”
The state faces a multi-billion-dollar budget shortfall heading into the next fiscal year.
